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Dan Palmer told the Enterprise he feels the board has chosen a direction with the budget that he can't support.

"The continued use of fund balance to balance this budget, it's not something that I can support," he said. "And truthfully, that's not my role to determine that. But I can choose whether I'm going to participate in it. I just don't feel like I can; I really think it's a serious mistake a couple years down the road.

"If I can't influence this board to do something different, then I'm really being paid for something that I shouldn't be accepting pay for."

Earlier this fall, Palmer and his staff developed a three-year plan to balance the county budget. It would have increased the tax levy by 26 percent in 2013, 16 percent in 2014 and 3 percent in 2015. Palmer said that while the tax levy increases would have been substantial, the actual tax rate would have remained below 4 percent, lower than neighboring Clinton and Franklin counties.

But some supervisors, including Wilmington's Randy Preston and Moriah's Tom Scozzafava, said their constituents wouldn't accept a double-digit tax levy increase. Last week, the board proposed additional cuts and the use of some $7 million in fund balance in order to meet the state's tax cap. The current budget would increase the tax levy by 2.6 percent next year.

The fund balance has about $8.5 million in it. If the budget is adopted in its current form, that figure would drop to approximately $1.5 million. The board expects to receive reimbursements from the Federal Emergency Management Agency totaling about $2.8 million and another $4 million from the sale of the Horace Nye Nursing Home, which has not been finalized.

"That still doesn't change the fact that you're starting next year with an almost $8 million gap," Palmer said. "You're still going to be short. This is something that's been such a frustration for me, is the almost inability for the general public and the board itself to understand that when you're paying costs that are going to reoccur out of fund balance, you're eventually going to run out."

Palmer has 19 years in the New York State Retirement System. He said he's not sure what he'll do after he retires.

Douglas said he's spoken with county Community Resources Director Mike Mascarenas, who also serves as deputy county manager, and Judy Garrison, the board's deputy clerk, about their willingness to take on additional responsibilities if the board doesn't find replacements for the Palmers by Jan. 1, 2013.

"I will also call the staff at the (information technology) department to make sure we have no issues in this department during the transition," Douglas said. "I will also call a department head meeting soon to meet with them to share concerns as we move through this process."

Palmer started as county manager in August 2008. He was the county's personnel officer from 2002 to 2008. From 1994 to 2002, he served as the supervisor for the town of Minerva. The Palmers live in Minerva.

Palmer said his wife's decision to retire wasn't connected to his concerns with the county budget.

"Hers is more of a personal decision," he said.

A message left for Deb Palmer hadn't been returned as of Monday evening.